Direct aid to N.J. colleges cut in Christie budget

Gov. Christie's proposed budget calls for increasing some types of financial aid but would cut direct funding to New Jersey state colleges and universities, according to the budget summary released this week.

The budget document describes funding as flat, but direct grant money to the colleges and universities would decrease as benefits paid by the state, including health care and pensions, increase. "Approximately 2.6 percent of . . . total support will shift from direct operating support to fund increases in fringe benefit costs," the summary said.

"We're very concerned, because the reduction in this budget proposal would be a significant share of our institutions' direct appropriations, and it would continue a pattern of declining state funding for public higher education," said Paul R. Shelly, spokesman for the New Jersey Association of State Colleges and Universities, which represents four-year schools other than Rutgers University and the New Jersey Institute of Technology.

Those nine schools, including Rowan University, Stockton University, and the College of New Jersey, would experience a collective drop of 7.07 percent. Allocations for the individual nine schools were not included in the summary.

Rutgers' direct funding would drop 3.73 percent under the proposal, and NJIT's would drop 5.98 percent.

The other nine state colleges would collectively receive $267.52 million in the next fiscal year, which begins July 1. That would add up to the second-smallest share of the overall budget from fiscal year 2006 through fiscal year 2016.

The proposed cuts would be the first reductions in direct higher education funding since the 2011 fiscal year, when the total budget shrank more than 6 percent, and the nine schools saw a cut of more than 10 percent.

"We've had some big cuts in the past. Certainly, it's a substantial cut," Shelly said. "It's not the biggest, but it's not flat funding."

While the direct money would decrease, the state pointed to broader measures of higher education support.

Financial aid funding would increase about 3.6 percent, with Christie touting a 5.3 percent increase for the Tuition Aid Grants program.

"The total of $2.23 billion to higher education includes year-over-year increases in support for student financial assistance and facilities, accompanied by level funding for colleges and universities," Christopher J. Santarelli, a spokesman for the state Treasury Department, wrote in an e-mail. "As in past years, appropriations to colleges and universities include both direct operating support and employee fringe benefits. This method of balanced support is similar to state aid for municipalities and other areas of government."

The state pays benefits for employees of public colleges and universities. Direct operating support and tuition and fees are applied directly to operating costs and students' educations.

Declines in direct state funding are generally made up by cutting costs and increasing other sources of revenue, which historically has fueled tuition increases.

The New Jersey Association of State Colleges and Universities says in its 2014 Accountability Sourcebook, a document of current and historical data, that "tuition increases are lower with greater state support."

Still, school officials were wary of predicting the impact of the funding cuts, especially this early in the budget process. The full budget proposal has not yet come out, and hearings will be held before the Legislature passes a budget and returns it to Christie.

"At this point, it's very early. We're still gathering information, asking questions, and assessing what the effect of this proposal's going to be," Shelly said.

Rutgers released a one-sentence statement Tuesday and had no further comment Thursday: "We are still analyzing the governor's proposal and will testify this spring on the ways that the proposal will affect the university."

Rutgers' funding would fall to $393.98 million from this $409.24 million this year. It had requested $434.78 million.

Rowan's president, Ali A. Houshmand, has pledged not to increase tuition and fees at more than the rate of inflation. Increased enrollment will bring in greater revenue, and the university will search for ways to tighten its belt, Rowan spokesman Joe Cardona said.

"At this point right now, we'll go through a bunch of scenarios in planning it out, as we do every year. . . . As a university, everybody will be asked to reevaluate everything and look at what we can do," Cardona said.

"At the end of the day, we have to reprioritize initiatives, and see what can be delayed and what can't."

In the long run, Shelly said, public colleges and universities are also hurt by the lack of consistency and predictability of state funding.

"The larger long-term issue is predictability. It makes it hard for the colleges to do strategic planning if they don't have a clear picture of where their finances are going to be, even a year ahead," he said.